"The good news is that the next generation of executives is still eager to lead our largest companies. The unsettling news is that the public reputation of CEOs needs to be restored and trust in the chief executive office has to be rebuilt," said Micho Spring, head of Weber Shandwick's U.S. corporate practice. "CEOs can play a pivotal role in getting U.S. business back on track and headed in the right direction."
What Can CEOs Do to Rebuild Trust and Confidence?
How can CEOs win back their good names? Executives overwhelmingly believe that the road to CEO redemption requires publicly taking responsibility when their firms are in crisis (90%) and tying CEO compensation to performance (83%). Other critically important steps include holding more face-to-face meetings with employees (68%), publicly speaking up for themselves and their companies (54%), being more transparent (52%), and issuing regular CEO updates about their business outlook (52%).
Among executives, the least effective way for CEOs to rebuild trust is by using social media, such as Facebook and Twitter, to communicate with stakeholders (12%). As previous Weber Shandwick research has shown (www.online-reputations.com), executives are just beginning to make good use of and feel comfortable with the opportunities provided by social media.
"Clearly, the best remedy for restoring CEO credibility is accountability," said Leslie Gaines-Ross, Weber Shandwick's chief reputation strategist. "Given the past 12 to 18 months of economic turmoil, it is no surprise that CEO reputations have taken a beating. Now is the time to show the next generation of leadership that leadership credibility can be rebuilt and that CEOs have listened attentively to public criticism. Communications, solutions and transparency should be high on all CEOs' agendas."
Reputation Recovery in 2013
Executives estimate that it will take an average of 3 1/2 years for the collective reputation of CEOs to fully recover. Recovery would therefore take place sometime in 2013, according to those surveyed.
The Road to Reputation Recovery
Looking ahead, CEOs are at a crossroads and should now begin rebuilding their collective reputation. A 14% "approval rating" has to be a stinging blow. Weber Shandwick offers the following advice to not only speed the reputation-rebuilding process but also to act as a guide for leadership in good times and bad.
- CEOs must be the first line of defense. As executives overwhelmingly recommend, CEOs should take responsibility when their companies are in crisis.
- CEOs should communicate in heavy doses - people are hungriest for information when times are tough. Executives cite basic communications, internal and external, as the best means to repairing CEOs' reputation: increasing the number of meetings with employees, speaking up for themselves and their companies if they are unfairly criticized, pledging greater transparency and regularly updating their outlook on business. Sometimes it's not the crisis but how leadership responds or does not that harms reputation.
- CEOs must set the right example. Since companies have to a build a robust talent pipeline to get the best talent into the chief executive seat, CEOs must not only set examples as ethical and credible leaders but expose rising stars to the challenges they can expect to face every day. CEOs can build their reputations by doing the "right thing" in the first place and not waiting for a crisis to make that happen.
High Marks Given to Own CEO's Reputation
Interestingly, there is a considerable gap in how respondents perceive the CEO of their own company and CEOs overall. While only 14% rate the reputation of CEOs in general as positive, a hefty 9 in 10 (86%) rate the reputation of their own CEO as strong. Apparently executives acknowledge that the reputation of CEOs collectively has been tarnished by the highly publicized mis-steps of a few CEOs, but approve of and appreciate their own CEO's efforts during these demanding times.
According to one respondent, "I would like to see more CEOs like the one I operate under who is much focused on ethics and integrity and treating our employees with respect. He does a great job and is a great example. If we had more like him, they would have a better reputation in the public eye."
Why Be CEO?
The top reason given for wanting to be CEO is the desire to lead and impact a company's or industry's future. Other reasons include dealing with business challenges and driving company growth. Some also responded that they are cut out for the job and believe the position offers career advancement and personal reward, be it compensation or personal gratification. As one executive said, "I enjoy leadership and business challenges. I like achieving great results and leading people."
The major reasons given for not wanting to be CEO are excessive pressure and public scrutiny. Others said they are satisfied with their current position or do not want to sacrifice their current work-life balance. As one executive said, "I just think that the pressure and public opinion that's put on a CEO is tremendous right now. I'm not sure it's worth the compensation for the pressure, at this point."
